Sunday, February 8, 2009

$500,000 is SuperWealthy? Not in NYC

Anyone who thinks that the President's plan to cap executive comp at $500,000 for the banks who took bailout funds is a good idea needs to consider who is going to take those jobs when they could earn multiples of that $500,000 at another company.

But is $500,000 a reasonable cap? Maybe in Houston, but not in NYC. They Daily News reports that a New Yorker would have to make $123,322 a year to have the same standard of living as someone making $50,000 in Houston. Said another way, a $60,000 salary in Manhattan is equivalent to someone making $26,092 in Atlanta.

Which raises another topic. In all of this economic stimulus discussion, are we ever going to recognize that it costs more to live in certain cities than in others? Saying that you are going to give X dollars to anyone making less than $50,000, without recognizing the vast differences in costs of living harms those living in those high cost cities.

Or is that just the New Yorker in my talking?
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